New industrial policy for Pimpri-Chinchwad, implementation a major challenge

PUNE/PIMPRI CHINCHWAD: The recently unveiled 'New Industrial Policy 2013-18' received mixed response from the industrial sector here. Insiders feel that though the picture of the policy is very rosy, actual implementation is going to be a major challenge.

A proposed investment of Rs 5 lakh crore, jobs for two million people, new industrial corridors and attractions for micro, small and medium industries are part of the industrial policy. The new policy, aiming to increase the state GDP from 26 to 28 percent, will be implemented from April 1 and will be valid for five years.

The government has proposed integrated industrial areas (IIA) to ensure all-round development and boost the "walk to work" concept along with proper all-round development in the state. Since there were issues like minimum alternate tax and dividend distribution tax in special economic zones (SEZs) government has now planned to offer IIA's.

Premchand Mittal, CMD of Vasant Group of Industries and vice president, Pimpri-Chinchwad Chamber of Industry, Commerce, Services and Agriculture, is positive about the IIA concept, calling it the need of the hour. "However, if this proposal is meant for builder's benefit than definitely it will hamper the industrial production. Farmers have surrendered their lands for industrial development, but if this is to be occupied by builders, then this will be unfair."

FOCUS ON MSME

Anant Sardeshmukh, executive director general of Mahratta Chamber of Commerce Industries and Agriculture said, "The industry was anxiously waiting for the policy, themed 'Magnetic Maharashtra-Brand Maharashtra', since the expiry of the earlier policy on 31 March 2011. From the salient points which have appeared in the media, it appears emphasis is on the small and medium enterprises (MSME) segment. Notable is the commitment to make Maharashtra number one in industrial activity and also making it more investment attractive.

Confederation of Indian Industry (CII) has welcomed the shift of focus from attracting investment from big industrial houses to MSMEs, as they constitute over 90 percent of the total enterprises in most of the world economies and are credited with generating the highest employment and account for a major share of industrial production and exports. In India too they play a pivotal role. MSMEs in India account for more than 80 percent of the total number of industrial enterprises and produce over 8000 value-added products.

Sardeshmukh opined that the industry appreciates the enhancment of manufacturing in the state GDP, the new initiatives of development of skilled manpower, dispersal of industries in backward areas of the state, FSI enhancement by 0.5 percent in MIDC areas and generation of more employment and investment.

WIDER ROLE FOR SEZs

The SEZ exit policy introduced by the government seems to have won supporters. In this regard, the policy provides a fully developed industrial infrastructure to those units who want to establish manufacturing units in Maharashtra in a situation where land is scarce and not easily available. Sardeshmukh said, "Pimpri-Chinchwad would definitely be benefited by this as we have land in the vicinity and we expect more international units to come here as they really are aware of the potential this area has for manufacturing. Any new activity would be beneficial for creation of new employment and enhancing economic activity."

Pradeep Bhargava, chairman, CII WR and director, Cummins Generator Technologies India, feels that one of the main stays of the policy is the creation of integral industrial townships and the SEZ Exit plan which envisages release of de-notified SEZ land which is proposed to convert into integrated industrial townships. He said, "This addresses one of the most crucial issues of land availability for industry. And we are happy that the Chief Minister has stuck to his commitment he had made at a recent interaction with CII members on creation of new economic hubs and special township projects".Â

The township will not only have the manufacturing facility but also other basic infrastructure including residential and allied facilities. These types of integrated industrial townships, which exist in many industrialized countries, is needed to enhance manufacturing.

POLICY OF APPEASEMENT

Mittal, of Vasant Group feels that the policy has been designed to appease the electorate for the coming 2014 elections. "The policy talks about giving booster support to the manufacturing sector. But the question about Mathadi Kamgar (Cargo labour) has not been discussed at all. Also, we had demanded that they should give separate powers to MIDC's. There is nothing related to it."

Apart from this Mittal pointed out that the power rates are too high in the industrial belt. "In comparison to Gujarat, we have to shell out more money. Nothing is said about this. We have been paying Rs 11 per unit for electricity."

One of the highlights of the policy is a 1,000 MW gas-based power plant and multi-modal logistics park in the Talegaon area on the outskirts of Pune, as part of the state government's initiatives under the Delhi-Mumbai Industrial Corridor (DMIC).

He feels, keeping these considerations in mind, the GDP might experience the negative growth and at least Pimpri-Chinchwad might not be able to attract any major investors. "Even the operation of One Window System has not been effective. Over all I feel this new Industrial policy has nothing for our area," he concludes.